tv [untitled] January 20, 2011 3:00am-3:30am PST
should be able to provide 100% green and clear energy. those funds will fund the green power investment fund to purchase additional green energy. there will be conservation and rebate type plans for customers. this helps to set aside some of the problems with a great shock this is recommended by the rate consultant and trying to fight the cost of race. that means the cost during the
summer would be higher than those during the winter. we will propose low income discounts of about 30% off the retail rates that will describe any moment as well as the medical assistance program for those customers that relied on electrically powered devices. in terms of the rate proposal perspective, what it shows is the proposal on the right reflecting the 10% savings over the pg&e rates. this is different than the rate structure from pg&e which is being consolidated into a three tier system. they all have the same numbers.
they represent that those are in a single tear. our customer service charges include customer service and billing related type expenses. the discount would be 30% off of the rates. this is not so much a rate adjustment as an expansion in the kilowatt hours because they will have a higher electric demand. what this looks like for our budget and cost of service, cost of service as described is what you see in this chart to the left. on top of that, we are lower in the contribution between 1 cents
and 2 cents per tear as well as the -- contribution. if you look at the capital fund column, you will see the vast majority of that rate. this will fund future green power purchases. the total residential rate proposed is about 24 cents. we would like to show you what the average bill looks like. this is the estimated average customer use the bill per must between 52 and $77.
on the commercial side, many of the reactor before similar in terms of the various programs but the actual structure is different. there is a single tear which is the standard until the the approach to rate setting for commercial customers and you differentiate different uses based on season, the summer season which is a little bit pickier will be a little higher than the winter season which is from november through april. this is providing a 10% savings as proposed by pg&e. the capital investment arms provide an economic stimulus rate for providing customers into the regional mysterious and
funding our public goods benefit programs and the stabilization reserves. pg&e's rates have 11.3% rate of return included in their rates so that is where we can provide some cost advantage because we're not looking for profit. specifically, what the rates look like on the right side for reflecting the 10% as proposed pg&e rates reflect the difference between the winter and summer variants and the customer charge which shows the raids on a daily basis which is between $13.20 dollars a month. -- $13 and at $20 a month.
from a cost of service perspective, this is with the average cost of 9 cents a gallon over five years. on top of that, we are glaring at the additional contributions. we are projecting over the next five years assuming the bill that moves forward that we will be able to pull together about 1.3 million and the rate stabilization fund at about $3.8 million in the green capital fund. >> in what amount of time? >> over five years. >> thank you. >> we are averaging a bill and this would take about 3600 monthly kilowatt hours which would be about $500 on average
for that customer as compared to the proposed pg&e. miscellaneous fees are part of our proposal as with our other economic prizes. we have some -- as with our other economic enterprises. there is one-and-a-half% of the outstanding balance. there is a restoration feet. if the services terminated any is to be turned on, we can send a crew out there. these are currently with the water and wastewater. in these fees are tied to an inflationary index so do not be coming back and adjusting them each year but we will be looking at them periodically from the cost of service perspective.
my last slide it is talking about the effectiveness. these must be repealed or modified. we need to come back every five years. however, we will look at the cost of surface every year during the budget. we currently do that for the water and wastewater enterprises. in terms of future rate considerations, we consider this to be a base for us and this is a good exercise for us to look at our customer classes. looking at a future rate considerations, economic incentives, if we have a need for addressing a particular
customer that would like to relocate. electric vehicles, clean energy, and two other fairly popular areas. the fact is that we don't have any customers at the present time so we are happy to entertain those new rate support needs as the customer demand is better defined. that is the formal review of the rate proposal. we will be submitted the details for approval two weeks from now and i would be happy to take your questions as they relate to the rate proposal.
we have solar power programs, we have the ocean generation, does this fully fund that? or does this reduce that resource? >> first of all, we are starting off with nothing as far as these redevelopment areas. what we are funding a as 10-$15 million of energy efficiency become a public benefits types of programs. right now, we are finding the equivalent of 10-15%. the apartment is that we find
2.85%. -- we find ourselves at 2.85%. this is a low cost. >> i think he might be answering the reverse of my question. the methodology looks at the entire enterprise and it creates a category for the public benefit and also for funding the green power. does the enterprise represent an increase in funding or a decrease in funding to those kinds of programs? what you have said is that we are doing more than is required so we don't have to worry about the requirement. the question is whether we are fully funding what we are doing. >> there would be an additional
2.85% included in these rates so there would be a few thousand dollars which would be part of the projected load depending on how big it is. we don't know for sure how many of those 10,000 units will actually be built by 2011. we have the developer's projections and that is what we are using in our capital plan. by way of comparison, if you look at 2.8% on this protected loan, that would be $31,000 of additional revenue we could put it towards the public good compared to the $10-$15 million we are already doing. while we are building the rates that we think are respectable and meet various goals for the
efficiencies, the amount of extra revenue generated or not be a terribly large funding service for the public good. you are already super funding if you look at what the policies are. >> if we were to take all the money that we were spending in those programs and reflect that in the analysis, what would that do? >> we have already reflected that tend to we have assumed the 10-year capital plan. we have the energy efficiency provisions in there and that is the average cost for the enterprise which would be 9
cents. everything you have had in your financial plan, your capital plan, in your adopted budget, that is what is intriguing because this is an intriguing system on the generations side, even with all of the additional costs and the investment on the energy efficiency and the $5 million a year, we're still able to come to you and propose rates that are cheaper, greener and economic development incentive for people to purchase homes and start businesses.
>> i think that that is a critical thing for all of these discussions. all of this is based on a very small load and a very small number of people. we will not have to go out and buy a lot of power. >> i think what i'm hearing is that this is not a revenue source that we have any place else. >> this is a few thousand dollars.
this is not an option on this type of customer. >> that 9 cents rate includes all of the energy efficiency program in. that is assuming that that money will basically stayed the same. >> a relatively flat budget, that's right. >> there might be allocation within that. >> you will see some of those things going down. >> the basic totals will stay the same.
>> i want to make sure that commission amaranth had a couple of questions. >> we understand what we are aiming at is an aim at a redevelopment areas. one of the questions is what do we do with the subsidy to the general fund. the general funds will end up paying costs as well. there is no assumption that dealt with that deficit. >> our hope is that this will
not raise the cost of doing so. >> we've talked about why it is our hope that this has happened. when i first do not with this, it was nearly 40 years ago. the general manager was an advocate for getting rates up to two levels. he was never successful in doing that. it was never the right time. either you have a budget balancing or a projection at this level. what i have seen is that we will
never get there unless something pretty drastic happens. if we are setting restructure's and we want to give a class of customers it benefit that derives from the system, i have no problem with that but i don't want to give it away twice. i'm wondering if it makes sense. does it make sense to build this into the rate structure so that until such time as we bring the general departments up to a cost of service-based rate, that the
other rates will reflect that. the redevelopment portion would be relatively small because it would be allocated among everyone else. this would be a very useful line item to have in the rate calculations so that if you want to lower the rates, it is self evident that one of you could do this would be to deal with the general fund subsidy. >> this is a difference between the average cost of 9 cents vs. 11 cents. the way i illustrated that the was that those are two parts. that excludes the rate stabilization. >> i did not hear that. >> the proposal from stuff is also 11 cents and the 9% average cost in addition to the 2 cents per kilowatt hour for the
stabilization fund. >> that is different. there was the value of the general fund subsidy. >> we are happy to help you look at this. you are correct. >> that is the general fund subsidy question and that is the white elephant in the room as far as these discussion go. we would very much welcome as part of these discussions some suggestions and recommendations on how to crack that net. this is one suggestion. maybe there is a way to create a methodology to see if it would work. how else could we do it? it keeps coming up.
i think we need to really be moving towards at least covering the cost of service to the general fund departments if not incentives as far as cost goes. >> in the current year and in the budget year, if you were to look at adopting his rates, you will still be providing the same $54 million worth of lower- cost for the general fund, whether you have these as they are now or not. by looking at this small sliver alone for just the redevelopment, helping or harming the general fund or other rates. >> i think that is the point they're making. do they want to change the methodology so we show this differently and therefore it to
increases the interest and possibly changing the subsidy. now, we don't get a chance to talk to the port of supervisors or anyone else. what you need to do is to pay your fair share. that is on the table. >> my last observation would be the nature of a five-year rate within the power market, which is very volatile. there was an objection that was raised because the rates are expected to go up over the past 15 years and our rates would be at 80% of pg&e. that makes me a little uncomfortable that we are providing a deeper and deeper discount from what the market indicates is the value of our and not just in -- is the value of power and not just he frequently.
>> we are going to revisit this annually. pg&e has averaged two rate changes every few years. staff here, just like we did for water and waste water rates, we revisited the requirements. what you have seen here is an assumption for 2011 and for the last 12-18 months. if you want us to come back -- >> the question goes beyond that because if you came back every month, we would have roughly the same answer. there's nothing in here that talks about the market. there is nothing in here that talks about market value. this is cost-driven. if the market changes, you will come up with the same answer. i note this as a point of
discomfort. i don't have a suggestion. >> we were interested in having our rates below are, the energy mix be greener, and i also thought was useful to save the stability and pricing for people which is a safe thing. one of our intentions is not to change this too often. that does not mean that you get out of sync with the market. we were intentionally trying not to make these changes on a frequent basis.
>> we have acted in what our costs are under the agreement and the projections through 2015 as included in the cost of service. >> thank you. sorry to keep you waiting. >> i sit as chair of the rate fairness board and i see some new faces on the commission since i have been here last. welcome, if you have any questions. i will try not to go over too much has gone through 04. there are a few items in discussion. i will not dwell too much on the staff proposal of the rates. we will talk to the power process and our recommendation and our opinions. the rate fairness aboard was established in november of 2002. we are an advisory board to this
commission. this also sets forth rate policy goals, cost of service, etc.. we can hold public hearings, which we do, and we make rate policy recommendations. this is our fifth go round before you. we finally got to talk to about -- rates and this is our first presentation regarding the electric retail rates. who are we, we are a seven- member board. there are four civilians which represent residential and commercial customers and we also have three very able members of the staff who are on our board. we have had about six or 8 meetings and they have been very engaged and msk